The show is still a valuable tool for analysts, according to Todd Greenwald of Signal Hill Capital, because its mid-year timing gives them a chance to see what's ahead in the second half of the year. "The other shows, E for All in October is too late, and the Game Developers Conference in February is too early," he said. But other analysts say that despite the show's status as the industry's default big event, well-publicized changes in its format have dramatically reduced its stature.
"E3 is significant this year only because Sony and Microsoft are claiming they are going to unveil something big at the conference," said Dan Ahrens, portfolio manager at Ladenburg Thalmann Gaming and Casino fund. Michael Pachter of Wedbush Morgan concurred, saying, "The conference used to offer retail, media and investors an early look at games and an opportunity to speak with company management. Now the games have long since been announced and the event is virtually useless for retail and for investors."
Along with changes in format, E3 is also facing pressure as a result of several high-profile defections from the Entertainment Software Association, the agency behind the show. Companies including Activision, Vivendi and id Software have left the group over the past few months and will not be participating in E3, while others such as Codemasters and NCsoft have retained their membership but also declined to take part in the show.
"This year will be a big test to see if there will even be another E3 or who will participate next year," said IGN Vice President Tal Blevins. "Companies will see how much coverage they get out of the show and how much value they are getting out of the conference."
"E3 had much more of an impact when it was a show," he continued. "The videogame industry is about fun and entertainment, and we should have a show that reflects it."